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RUSSIA and the Chilean model

From Moscow, Cameron Sawyer answers Bill Ratliff about the Chilean model: "Even I, ignorant as I am about Latin American affairs, know about the social disturbances having been quelled by military force in Chile prior to the full establishment of the Pinochet regime. But Russians know themselves that you can put down social disturbances temporarily with force – they have plenty of experience in their history. What interests them is why, instead of flaring up again, Chile straightened out. I doubt that anyone thinks that this has anything to do with force. The common view here is that effective market reforms in Chile gradually healed the economy (naturally, with ups and downs, it just doesn’t happen any other way), and that the political and social problems of a society whose economy is growing are vastly more solvable than those of a society mired in poverty. The other salutary effect of a growing economy is that by giving an opportunity for the powerful and ambitious (who exist in every society) to earn money in an honest way, it reduces the tendency of these elements to enrich themselves by theft and corruption.

This model is attractive, and I suppose probably right, but I am not sure that it is unambiguously proved by history. Few non-Marxist historians of Russia have paid much attention to the economic factors in the evolution of Russian politics leading up to the Bolshevik coup of 1917, and in fact the period of 1900-1917 in Russia seems to contradict the Chilean experience. In fact, Russia at the turn of the century was the fastest growing economy in Europe (as she is today, ironically enough), having completed the transition from a very poor and medievally agricultural economy at the time of the liberation of the serfs in 1861 to an advanced industrial economy by the 1890’s, getting through a whole industrial revolution in just 30 years, which brought with it an amazingly rapid rise in wealth. But rising wealth for some reason did not create social peace; at least it did not prevent anarchists and Communists and other radicals from causing very serious problems. It seems hard to believe that the troubles of 1905 can be entirely attributed to the failed war against Japan, or to the pernicious activities of radicals. Something seems to have been wrong with society which wealth did not fix. Could it have been the autocratic rule of Nicholas II? But Nicholas was a benign and gentle ruler, widely beloved among the population (don’t believe what the Communists wrote about him later). And after 1905, Nicholas created a parliament and introduced some democratic principles. It is hard to understand.

Be all that as it may, Russia today is indeed following the Chilean model (as Russians understand that model) – first and foremost total dedication to "radical, comprehensive and sustained move toward free markets," in Pinera’s words. With the economy growing, the model seems to be working so far. Despite all of the hardships of the past 10 years, there is indeed social peace so far, democracy seems to be working so far, and there is a broad consensus behind the path of reform.

Ronald Hilton - 6/30/02